I am a partner of Riser Adkisson LLP and licensed to practice law in Arizona, California, Nevada, Oklahoma and Texas. My practice is in the area of creditor-debtor law, and I am the author of books on asset protection and captive insurance. I have been an expert witness to the U.S. Senate Finance Committee, and am very active in the American Bar Association, and currently am the Chair of the Committee on Captive Insurance. I was also the collection attorney for the $20+ million judgment by the San Francisco Bay Guardian against the holding company of the Village Voice chain. I am serving as an American Bar Association adviser to the Uniform Law Commission's revisions of the Uniform Fraudulent Transfer Act and the new Series of Unimcorporated Business Entities Act.

You Can't Fix Stupid: The Iraqi Dinar Scam Lives

In the words of popular comedian Ron White, “You can’t fix stupid.” That phrase, as elegant in its simplicity as it is frankly true, applies with special fervor to those who continue to believe that they are about to make millions, billions, or even trillions by investing in Iraqi dinars.

Yet this scam continues to persist, and hardly a week goes by that some sucker or another doesn’t call my office to inquire about asset protection planning for the untold riches that he or she is about to receive when the Dinar finally re-valuates by 100 times or more.

Of course, they can’t pay my legal fees now for such planning because every last cent is invested in the Dinars. But they can pay me when they finally reap their great reward.

Which is never.

Scams involving the arbitrage of foreign currencies have been around as long as there have been, well, foreign currencies. In the modern age, many pyramid schemes have been disguised as sophisticated “FOREX trading programs” — but in fact, the scammers weren’t doing any trading at all, but simply paying old investors with the money from new investors. Charles Ponzi, the modern Father of such schemes, would be proud.

There exists an entire army of FOREX scammers who spend their entire days looking for suckers, which unfortunately include the most vulnerable in our society such as the elderly. For those folks in or nearing retirement whose ordinary investments didn’t quite get them where they needed to be, these scam artists are ready, willing and able to divest them of their remaining wealth with promises of high “risk free” returns trading in FOREX. But that money is just disappearing to banks in Belize or elsewhere.

The FOREX scams didn’t involve any actual purchases of foreign currency, but simply scam artists running utterly bogus “statements” off their printers that showed huge returns, right up until the time that the scammers disappeared. Some of the Dinar scams operate the same way: You don’t actually get any Dinars, but instead just a statement showing that you have Dinars or some sort of phony-baloney “Certificate” of ownership.

But — and this is why the Dinar scam has been largely successful — with the Dinar scam you can actually get the cold hard Dinars if you want them. Yep, suckers around America have their closets and garages full of bales of Dinars, just waiting for that glorious day when they will re-valuate.

Which is never.

To help sell the scam, the scam artists have set up all sorts of websites and bulletin boards and newsletter and social media and you-name-it to try to create the impression that the Dinars are valuable and are about to re-valuate at any moment. I’ve had people tell me that their Dinars are going to re-valuate “within the week” or “by the end of the month”, and they’ve been telling me for years.

All of this reminds me of the “Magic Bean Scheme” which was a pyramid scheme run in my native Oklahoma by some creative scammers. The idea was that you could buy from the scammers a certain type of expensive bean that when left in a jar of water for a couple of weeks would produce valuable “bean juice” that could then be re-sold for a large profit. The key was, according to the scammers, you had to shake the jars every few hours to get the desired result.

Of course, the scammers threw some of their own money in to get the scam started. The first few people made some good money selling their bean juice, and of course they told their friends and family about this new sure-fire way to make a fortune. Soon enough many folks in Oklahoma were brewing “bean juice” in their garages, going out every couple of hours to shake the jars so that the bean juice would form faster. “Honey, it’s 4:00 a.m., and you turn to shake the jars.”

Then, one day after selling enough of the expensive beans, the scammers vamoosed and there were a lot of folks in Oklahoma with closets and garages full of jars of worthless beans and juice in them — turned out the beans were just ordinary navy beans. My guess is that there are still people out there who have never given up on the beans, still turning them, and still expecting that bean juice to result in untold riches.

Ditto for the Dinars, the bales of which some suckers having in their closets and garages, taking up space and waiting for the day when they finally re-valuate.

Which is never.

Unfortunately, a bad thing about human nature is that once folks believe in a story, they refuse to believe they have been scammed. Often they are embarrassed, and figure that to admit they were wrong is worse than simply keeping their useless whatevers in the closet or out in the garage. But others are really, truly convinced that their initial investment was a good one, and no amount of proof or logic can dissuade them.

Even after Charles Ponzi died, some of his followers bought OUIJA boards and tried to channel his dead soul to find out when their utterly worthless investments would become valuable as he promised. Time and time again, I’ve watched as the victims of pyramid schemes continue to believe that they are about to get rich even as the perpetrators went to jail.

For me, after telling these folks they’ve been scammed and hearing their denials, I’ve been betting these folks who call me up to $5,000 in free legal work if the Dinar re-valuates in 30 days, against a gift certificate from a steakhouse. Suffice it to say that I’m going to be in good beef for some time. Which brings me back to Ron White, who is absolutely right: “You can’t fix stupid.“

And that goes for the Dinars, and the idea that they will soon re-valuate, thus leading current investors to great riches.

Which is never.

So, why is this a scam? It is a scam because the Dinar has no chance or significant appreciation, i.e., appreciation that would make buying Dinars worthwhile. First, there is the political uncertainty — who would invest in the currency of a government that is still fighting a significant insurgency and might not be around the next year, any year? Second, and much more importantly, there are so many Dinars floating around that even if Iraq discovered the world’s largest gold mine tomorrow, the value of the Dinar would not significantly appreciate.

The scam artists say, “But look at Kuwait!” After the first Gulf War, the Kuwaiti Dinar did show significant appreciation. But that is an Apples and Orangutans comparison.

First, Kuwait is significantly richer than Iraq with significantly larger oil reserves — it is forgotten that the Iraq invaded Kuwait to get the latter’s oil reserves, not because Iraq had enough of its own.

Second, the Kuwaiti population is much smaller — 3 million compared to the 33 million living in Iraq. This means that Iraq has to take care of ten times as many people as Kuwait, as well as attempt to rebuild an infrastructure racked by a decade of civil war, with less money than Kuwait.

Third, and even more telling, the Iraq government even now has to borrow about $100 million per year to provide basic services. No country which is borrowing money is going to have an “imminent revaluation” (the term often used by the scam artists to sell Dinars) anytime soon!

Fourth, Kuwait had a stable government before the War that simply fled Kuwait until order was restored, and then returned to be a stable government. By contrast, Iraq’s government is new and whether it survives is anybody’s guess.

The point is that there is absolutely no reason to believe that the Iraqi Dinar will significantly appreciate in the long term, and it utterly insane to believe that the Iraqi Dinar will significantly appreciate in the short term, i.e., within 10 years.

And there is the scam: The scam artists sell Iraqi Dinars to suckers based on the false story that the Iraqi Dinars are about to become very valuable, when they are not. You might as well buy bags of sand, because they are going to appreciate more quickly than the Iraqi Dinar. Or just go down to the bank and buy rolls of pennies and hide them in the attic. Someday the U.S. government will get rid of pennies, and then the pennies will become rare and valuable — in about two hundred years. That is about how quickly the Iraqi Dinar is going to appreciate too.

After this article was published, I had numerous e-mails to the effect that I didn’t know what the hell I was talking about, and that the Iraqi Dinar would absolutely, positively re-valuate within a few days and the buyers thereof would become fabulously wealthy. Well, here we are 30 days later, and . . . the . . . Dinar . . . hasn’t . . . gone . . . anywhere.

If you think the Iraqi Dinar will make you rich, you must be listening to Baghdad Bob!

I’ll update again in 30 days — during which time the Iraqi Dinar will not have revaluated then either. But there will still be lots of suckers in denial at having been scammed sitting around thinking they are gazillionaires.

Nothing new to report. The Iraqi Dinar is as far from an upwards re-valuation as ever — you might as well wish for Jack’s Magic Beanstock to take the Dinar upwards. But, lots of seriously deluded folks still continue to believe they are going to get enormously rich off the bales of Dinar’s socked away in their attics and garages through America. My guess is that pretty quick you’ll be able to buy as many Dinars as you want at garage sales.

Update January 31, 2013

Well, I must apologize to everybody for not updating at the end of November and December, 2012, but I got very busy with clients’ year-end planning . . . and frankly nothing was going on with the Iraqi Dinar anyway. So let me take this opportunity to update you on what has been happening with the Iraqi Dinar through January 31, 2013, which is: Nothing, Absolutely Nothing.

I have noticed, however, that sellers of Iraqi Dinar are starting to offer “free gifts” to suckers who buy that currency from them, sort of like “Buy 1 Trillion Iraqi Dinar And Get A Free Pinata” or somesuch (the Vietnamese Dong, a currency of sorts, seems to be a popular give-a-way with purchases of Iraqi Dinar).

And so we come to the end of another month, and find the Iraqi Dinar to be . . . falling in value. Now it’s down to 1,260 Dinars to the U.S. Dollar, but hope spring eternal (in the minds of suckers). Some say that Iran is behind the devaluation, see http://www.al-monitor.com/pulse/originals/2013/03/iran-iraq-currency-devaluation.html but really who cares? Not only is the Iraqi Dinar headed in the wrong direction, but it is clear that there is not going to be anything like a huge re-valuation of the Dinar against the Dollar anytime soon. Probably most suckers have gone off to being scammed by some other currency by now anyway.

I’ll check back again at the end of next month when the Dinar still hasn’t revalued against the dollar, or even recovered its recent losses — but there will still be folks with bales of Dinars in their garage and believing that they are on the cusp of making a gazillion dollars, that’s the way scams go.

Then there is this slideshow presentation where a victim of the Iraqi Dinar Scam claims that it is a worldwide conspiracy – http://www.youtube.com/watch?v=TQoCw21CLSM Sorry, buddy, it’s not a massive conspiracy; it’s just a scam. But then victims of financial scams never like to admit that they have been taken, so they believe “the deal was real” all the way to their graves, much to the delight of the scam artists.

Update May 31, 2013

Another month, and another month where the Dinar did not massively appreciate but more suckers bought into the scam thinking that it would. But we are starting to approach the one-year anniversary of the date that I wrote this article, after which I received numerous e-mails from folks telling me to basically, “Just wait, you’ll see! Within a few weeks I’ll be stinking rich and you’ll just be a sad commentator for Forbes.” Well, at least they got the stinking part right, and so now own to the monthly update:

(4) Self-Annointed “Dinar Guru” Blanche Bonet put out this “amazingly” list of Iraqi Dinar “experts” who predicted that the Dinar was about to soar in value – http://www.dinarguru.com/ Trouble is, they were all wrong. The list does pretty much prove, however, that the “Iraqi Dinar community” is just a bunch of suckers trying to convince each other that they made good investments. As just mentioned, the trouble is that they are all just wrong.

I’ll check back in next month, when of course the Iraqi Dinar will not have RV’d, again. Suckers!

Update 31 July 2013

Welcome to the one (1) year anniversary of my article on Iraqi Dinars, where I predicted that — despite about 200 billion e-mails speculating that the Iraqi dinar was about to re-value (RV) tomorrow, next Monday, or next week — the Iraqi Dinar would not RV or anything close to it. I told you so ~ there I said it, even though it was a pretty easy prediction.

Now on to this month’s news regarding the Dinar:

(1) It didn’t RV.

(2) There were a bunch of rumors that it was about to RV, but,

(3) It didn’t RV.

(4) The government of Iraq is apparently re-denominating its currency (which is very different from re-valuing it), by simply lopping off 3 zeros at the end. So, if you now own 1,000 Iraqi Dinars, you will thereafter only own one. While some thing that this will cause a re-valuation, most experts have debunked such suggestions, such as http://www.wealthdaily.com/articles/iraqi-dinar-reset/4511

See you again next month, when the Iraqi Dinar still will not have RV’d despite another 173 million e-mails between investors saying that is is just about to do so.

Update 31 August 2013

Well, here we are again folks! Another months with hundreds, if not thousands, of rumors of imminent re-valuation of the Iraqi Dinar against the U.S. Dollar . . . and it not happening . . . or even getting close to happening . . . or my OUIJA board even moving close to the letters “R” or “V”. Hey, if you put your Iraqi Dinars into jelly jars and turn them twice a day, maybe that will do the trick. And now on to this month’s update about the Iraqi Dinar:

(1) It didn’t RV.

(2) There were a bunch of rumors that the Iraqi Dinar had RV’d, or was in the process of RVing, or was oh-so-close to RV.

And that is pretty much it — a painfully non-newsworthy month for the Iraqi Dinar actually. What if a country had a currency and nobody cared, except for the folks stashing bales of the stuff in their attic in anticipation of glorious future riches? I’ll update again next month, when again nothing will have happened. Cheers.

Update 30 September 2013

A reader wrote me with a couple of questions:

Q: If it is a scam, why are their no prosecutions?

A: Many scams operate for many years without prosecutions — Bernie Madoff got away with it for a couple of decades — and the Sequester has substantially limited new investigations and prosecutions. Also, prosecutors and investigators have limited resources, and usually spend their time on cases where the victims complain the most. With the dinar, most of the victims are still “true believers” who haven’t figured out that they have been scammed, and so are not complaining. Having said that, “Nobody has been convicted yet” has to be about the worst reason to invest in something that I have ever heard.

Q: Does the U.S. hold a large position in Iraqi Dinars?

A: No, the foreign currency reserves of the U.S. ending September 20, 2013, are found at http://www.treasury.gov/resource-center/data-chart-center/IR-Position/Pages/09202013.aspx and while the U.S. owns some small amounts of Euros and Yen, no significant holdings of Dinars are listed. That the U.S. government invests in a huge stockpile of Iraqi Dinars is just something that scam artists untruthfully recite to sell their suckers more Dinars.

And now on to updates . . .

The Iraqi Dinar did not RV against the U.S. dollar. There were another 20 Billion e-mails that the Iraqi Dinar was just about to RV against the U.S. Dollar, but it just didn’t happened. What did happen was a bunch of articles telling folks to beware the Iraqi Dinar scam, such as:

Apart from these legitimate articles, there was the usual junk from the scam artists and true believers, i.e., the Dinar is on the brink of RV’ing, and the only thing holding it back is that Cylons have infiltrated both the U.S. and Iraq governments and are blocking it from happening; as soon as the Cylons are destroyed, the Dinar will RV. Or something like that.

Update: 30 November 2013

I missed the update for 30 October 2013. I would like to tell you that it was because I had a big trial in October, which was true, or that I was very busy with ABA matters, which was true, or a bunch of other very true reasons why I might have missed the 30 October update. But the real truth is that I just forgot. That happens when nothing is going on with something, and there is a whole lot of nothing go on with the Dinar. And now on to the update, such as it is.

(1) Despite another 40 billion e-mail alerts from scam artists using stupid names that the Iraqi dinar was about to revaluate, or was in the process of revaluating, or that space aliens were going to descend on the U.N. Headquarters in New York and force a revaluation, the Iraqi dinar did not revaluate.

(2) There just wasn’t any real news about the Iraqi dinar. No press releases, no nothing. While the scam artists will now say that it is the calm before the storm (or the RV), the more accurate appraisal is that it is the calm before the nothing actually happening, i.e., the calm before even more calm.

(3) I do note that the same scam artists who were selling the Iraqi dinars are now bundling them together with the Vietnamese dong (What a great name for a currency: “Hey, buddy, can you spare me a dong?” or “Give me a dong, and I’ll pay you back later.”) Make sense from their viewpoint — if you are dumb enough to buy the dinar, you’re probably dumb enough to by the dong too. The sad truth is that many people are recidivist suckers, falling to stupid get-rich-quick schemes over and over and over. Or in the words of Homer Simpson, “I know that I’ve fallen for a lot of get-rich-quick schemes in the past, but this time I’m going to get rich, and quick!”

Sorry for the lame update, especially one spanning two months, but there is only so much reporting one can do about absolutely nothing, and that’s what is happening with the Iraqi dinar. Stay tuned for my special December 31st year-end “Nothing In Review” about absolutely nothing going on with the Iraqi dinar. And for those of you still harboring dreams of great riches with your jars of magic beans, well just keep turning them and good things will happen.

31 December 2014 — Year End 2014 Update

Well, loyal dinar investors, we are finally here! We are at the place where you need to get your confidentiality agreements with your financial advisers in place, and start looking for expensive houses on the French Riviera. Yep, for you it is champagne and caviar from here on out. The latest rumors say that the Iraqi dinar is just about to RV. Heck, the Vietnamese Dong and the Melchizedekian Shekel are about to RV too. Plus, NESARA is about to be passed into law, and that means that Omega Trust & Trading is about to pay off. Bernie Maddoff is going back in business. Heck, even Charles Ponzi is coming back from the dead to pay off. It all starts right now!

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Well my money is doing nothing in the bank thats for sure!! I don’t think this fits the definition of Scam does it now. Nothing illegal and we all know what we have gotten into. And we hold the currency. I could go to the WTC downtown LA and exchange for USD anytime and take a 10% loss. But that would really make me stupid. How’s your portfolio look? This is not as much an investment as a gamble. I could easily lose as much at a blackjack table in an hour. I guess all of Vegas is a Scam, maybe letting Forbes invest for you is a scam, same definition as you are using.

Funny how a bigshot like you watches hillbilly comedians like Ron White.

I have not invest in Dinars but what I can say is that I have read a few articles that are both pro and con to this investment. So far the information compelling people to buy is far more informative than the articles about NOT investing. Like this article the author simply says “don’t buy because I say so.” There is never any pertinent evidence as to why we should comply.

For example, a few articles I have read state that the Iraqi dinar was exchanging at $3 USD to 1 IQD at a time when Sadam was in power and under United Nations blockade and the country had two different currencies. Now the country is free of trade restrictions, the IMF is giving positive reports and extensions as well the country has been united under one currency. The US has invested great sums of money to rebuild the nation, there is a new government that seems to be stabilizing, oil production is increasing and foreign investors are returning to the country after decades of instability. Why would it not be feasible that the currency would once again become as strong as it was in the past under Sadam???

TELL ME SOMETHING concrete and not just say “you are stupid” and should listen to me.

It’s a preposterous analogy. In 1914 you could buy a Ford automobile for $179. Does that mean you be able to buy one today for $179. Of course not! The dinar today is not the same dinar that existed during the Saddam era. In fact, dinar from the Saddam era are worthless. They share the same name, but that’s it. How many dinar existed during the Saddam era? What was the exchange rate at theat bank (hint: they couldn’t be exchanged, the rate was established by Saddam for exchange within Iraq only). This whole notion that it’s the exact same currency is wrong.

Concrete? According to the Central Bank of Iraq, Iraq has produced 78 trillion dinars. Most dinar pumpers suggest the dinar is going to revalue somewhere between $1 to $3 each which would value Iraq’s money supply anywhere from $78 trillion to $234 trillion. Yet the entire value of the world’s currency combined is only about $60 trillion. So teeny, tiny Iraq which is the 107th largest economy in the world is going to have a money supply greater than the rest of the world combined? Acccording to the CIA World Index, Iraq’s GDP is less than $300 billion. If the dinar revalues at even 1 US cent, the total money supply of Iraq would be valued at nearly 3 times it’s GDP! In comparison, the US GDP is nearly $17 trillion yet our total money supply is only valued at about $10 trillion. But, hey, believe what you want. A fool and his money are soon parted.

I came to this site. I read everything and the dinar sites have their “reasons” and yes they have been way wrong or late ha, but it seems if you wait it out it will increase. Maybe not millions but possibly .8 cents and that wojld be amazing. So please … show me something that is more than rants of scams.

Okay jackass, let’s assume that the dollar appreciated by 100 times its current value. How would any other country afford to buy our products? they couldn’t. What do you think that would do to our economy, which sells about 40% of total GDP outside the country? Answer: companies would be destroyed. those that could remain open would fire half their workers. We would have 60%+ unemployment. Does that sound like something that we would voluntarily do? Of course not. No country would ever allow their currency to appreciate that much. If Iraq ever gets their act together, they will reissue a new dinar, and all old currency will be exchanged for the new stuff, as every other country has done that has devalued. Read your history. Look at what happened in Germany after WWII. Look at what Latin American countries do after they devalue. Currencies never, ever, ever revalue massively. It is an economic impossibility.

The news everyday out of Iraq can be read at thecurrencynewshound.com I have been following this for years and don’t think it will be tomorrow but I do think for many reasons that this country is starting to make alot of progress and they are introducing lower denoms into the system in January of 2013. If this is true, they have to re-value. Iraq’s head of the Central bank has also been on record saying they were going to re-value when Iraq gets stable. They have done much on the list and when the Chaper 7 is lifted I believe you will see an RV. This guy is right about the scammers on Forex. I bought the Hard Currency from a US Bank. It is an investment and it has gone up 3% since I bought it so that is more than a savings account for a chance for something bigger. Could go on for hours and know much about this from some pretty credible people. The author makes no credible facts other than he thinks its a scam. Maybe he will be the stupid one one day!

Hard currencies are NOT an investment. In the last 4 years, the dinar has appreicated .33% against the US dollar. Since you paid a premium of 20-25% to buy dinar, you haven’t made any money (despite your insistence otherwise). You’ve taken a bath! Why do you feel the need to lie to people to make your case?